CHAPTER FORTY-THREE
THE IMPORTANCE OF PEER GROUPS
It's often said that being a CEO is the loneliest job in the world. Fred Wilson describes it elegantly in a blog post from 2005:
I often look at a founder or a CEO, see the tired eyes, an anxious twitch in the cheek or a missing beat in their step and think to myself or say out loud to others—he's got the weight of the company on his shoulders.
Being the founder and/or CEO is heavy duty. To use another cliché, it's lonely at the top…. Most people, regardless of how well prepared they are for the role, will find being the leader to be a thankless role at times.
Everyone inside the company is looking to you for answers, leadership, direction and on top of that, they want it with a smile and a pat on the back.
Try doing all that on a day when you find out that the numbers were awful the past month, that your CTO is leaving to do another startup and your lead investor is giving you a hard time.
Frankly, it's a thankless task most of the time. Because who do they report to? A board, not a person. A board is a lot less likely to provide day to day management and support. Groups don't do that, people do. Unfortunately, a board is a group, not a person.
A great coach can help with this. So can a great board, acting as a group or as individuals. Quite frankly, so can a great management team or even an informal “kitchen cabinet” inside an organization. With all of those, something is missing. Even the most empathic boards or coaches, even ones who have been CEOs before, aren't in that job at that moment. There's no substitute for discussing your challenges with active CEOs.
THE GANG OF SIX
I've found that having a peer group of CEOs has been an invaluable asset. There are lots of different ways of finding, joining or starting a CEO group. The most common ones are the Young President's Organization (YPO) and its even younger sibling, the Young Entrepreneur's Organization (YEO). There are others out there like the CEO Forum and Caitlin Cookman. I haven't joined any of those for one reason or another, so I've made my own. (It must be the entrepreneur in me.)
My group consists of the CEOs of six companies based in New York. The companies all have a number of things in common: size (at least 100 people), stage (revenue or growth, not pure startup), private, independent, VC-backed and somehow touching the Internet, though noncompetitive. All of us have worked, in one way or another, with the same CEO coach over time, so he joins our meetings and facilitates the discussion. We meet about six times per year at one of our offices for four hours at the end of the day, usually with a snack and wine or beer. In our first few meetings, we made sure that a couple of us gave our standard investor presentation to the group so that we all started to learn the ins and outs of each other's businesses from the start.
Our meetings are relatively informal. Everyone is extremely good about showing up—we calendar the dates well in advance—so there's a high degree of continuity in the group. Sometimes one of us will email a topic out to the group ahead of time, maybe with some advanced reading. We keep things 95 percent business—though sometimes the personal leaks in a little bit. We start meetings by “checking in” and taking turns running through things going on at our companies. We try to do this part with a 10-minute rule and a timer to keep the conversation moving and we note the topics that require a longer conversation as we go so that we can come back to them once we're done checking in. In the longer form part of the meeting, we help each other solve problems. We challenge each other, sometimes quite aggressively. We laugh a lot together. We understand what each other are going through. There's usually enough empathy in the room to power a small city.
There are lots of different ways to create groups like this and lots of use cases for them as well. My current group is the third one I've had in my career as a CEO, though it's the longest running and most high functioning of them. The others were even less structured dinner groups that didn't have an owner or leader or real commitment to attend 100 percent of the time. As a result, they decreased in utility over time and ultimately disbanded. Some of the more professional groups cost real money to join and have even more rigid structures, time commitments and formal presentations. As with most things like this, it's less important what kind of peer group you form or join than it is that you form or join one.
PROBLEM SOLVING IN TANDEM
The kinds of topics that a peer group can tackle together are extremely varied. My group usually ends up focusing on things that are challenges unique to the CEO job: managing a board or investors or a financing; hiring and firing executives; setting/changing strategy; organizational and cultural challenges; and, in a couple of cases, selling companies. Sometimes we just share best practices on things that are maybe less weighty. It occurs to me that my CEO forum is kind of like a live version of this book—and in fact the members of the group are all represented among the different outside contributors here.
Once, one member of my CEO forum had an offer to sell his company and he was really struggling with whether or not to take the offer. The terms were, in his mind, “good, not great.” This is exactly the kind of issue it can be quite difficult to talk through with a management team or a board, many of whom will have their own emotions, hopes, dreams—and balance sheets—to think through. The rest of our group helped this CEO focus on what was right for the business and what was right for him personally.
The value you will get from a group like this is hard to quantify but easy to articulate. To come back to Fred's comment, having the weight of the company on your shoulders is not an easy thing to bear. Having a group of identically situated people to lean on makes it much easier.